A forecast has emerged that if Iran blocks the Strait of Hormuz, the export-import logistics business could suffer damage. The Strait of Hormuz is a narrow sea passage connecting the Persian Gulf and the Gulf of Oman, a strategic chokepoint in the Middle East and a global crude oil shipping lane.
The Korea International Trade Association held an "emergency export-import logistics review meeting on the U.S.-Iran situation" on the 1st at Trade Tower in Samseong-dong, Seoul, chaired by Chair Yoon Jin-sik.
The meeting focused on logistics risks for export and import and response measures that could arise if the Strait of Hormuz is blocked.
Twenty-seven percent of the world's seaborne oil trade passes through the Strait of Hormuz. Of the strait's total width of 55 kilometers, the section navigable by tankers is within 10 kilometers and lies entirely in Iran's territorial waters.
Korea sources 70.7% of its crude oil and 20.4% of its liquefied natural gas (LNG) from the Middle East, making energy supply instability inevitable if the strait is blocked.
KITA noted that while it is possible to use detour routes via major ports in Oman if the Strait of Hormuz is blocked, whether they can be operated in practice is uncertain.
This is because, as now, with Iran's missile attacks targeting U.S. military bases in neighboring countries such as Saudi Arabia, the United Arab Emirates (UAE), and Bahrain amid an escalating full-scale war, the safety of land routes and airspace cannot be collateral.
In addition, using detour routes could raise ocean freight rates by as much as 50–80% compared with existing levels. Overland transport and customs procedures could also extend transit times by 3–5 days. In the past, insurance premiums in the region have been surcharged by up to sevenfold.
Conditions in the Suez Canal are also a variable. Since the end of 2023, when the Houthi rebel situation emerged, carriers have opted to detour around the Cape of Good Hope, and Suez Canal traffic has dropped significantly from previous levels. Accordingly, KITA explained that the possibility of additional logistics disruptions is limited.
Direct export damage was also assessed to be limited. Korea's export share to the seven countries adjacent to the Strait of Hormuz is only 1.9% ($13.68 billion). Even if maritime logistics disruptions occur in the strait, the direct impact is expected to be small.
KITA will support small and medium export shippers expected to be affected in preparation for a possible blockade of the Strait of Hormuz. It plans to provide information on detour transport routes, including transshipment and inland transport using Oman's Salalah and Duqm ports.
It will also strengthen cooperation systems and information sharing with the logistics industry. By building close cooperation systems with national carriers and forwarders, it plans to provide export-import logistics trends in the region to export corporations.
It will also devise measures to ease additional expense burdens from using alternative routes. To mitigate higher freight costs due to overland transport and customs expense, it will request the inclusion of emergency items in existing logistics cost vouchers and pursue measures to secure dedicated vessel space for small and medium-sized corporations.
Chair Yoon Jin-sik called for constant monitoring of the export-import logistics situation and the establishment of a response system to minimize industry damage.